Search Services Pay A Visit To Mom And Pop; Firms Thinking Locally; Paid search companies aim to grow by targeting small-business clients.(INTERNET & TECHNOLOGY)

Byline: PETE BARLAS

The next battlefield for Web search firms: mom and pop businesses.

Yahoo Inc., Google Inc., Look-Smart Ltd., CitySearch and others are scrambling to extend their lucrative paid Web search services to small businesses.

The companies that succeed in tapping Main Street can expect rich rewards. U.S. companies with fewer than 100 employees are expected to spend about $22 billion in advertising this year, says the Kelsey Group. That's a big chunk of total U.S. ad spending, estimated at $230 billion.

"There are about 150,000 U.S. advertisers in the paid search market, and we think that's going to expand significantly in the next few years" by reaching out to small businesses, said Tony Mamone, director of sales and marketing for LookSmart.

In the last year, Web search providers have revived their ad revenue by selling paid search services. Advertisers pay to put their Web links or ads on search result Web pages.

The fastest-growing method is pay for performance. Advertisers pay a set amount, say 5 cents, each time a Web user clicks on their ad.